China has overtaken Japan to become the world's biggest holder of foreign exchange reserves after its stockpile grew US$8.5 billion in February to US$853.7 billion, the China Business News reported on Tuesday. Japan had reserves at the end of February of US$850.1 billion. Growth in China's reserves last month slowed from US$26.3 billion in January, the Shanghai newspaper said. (CE.cn)

The country should use part of its fast-growing foreign exchange reserves to buy gold as it seeks to adjust the asset mix to hedge against risk, a Bank of China official was quoted as saying yesterday. Analysts say China has been gradually diversifying away from the U.S. dollar, although fears of a collapse in the U.S. currency will prevent any dramatic shift. Government officials have denied reports they plan to sell current dollar assets in the reserves.(SD-Agencies)

"Absorb foreign capital," "open domestic market to the outside world," such phases marking that China opens its door on its own initiative and welcomes foreign capital have pushed many Chinese senior officials in a dilemma. As a large number of spheres including steel, energy, communication, finance and transportation have been open to the outside world, foreign capital, which has eyed the Chinese market greedily for a long time, rushes to China by way of becoming a shareholder or controlling shareholder and acquiring Chinese enterprises. This may bring along many problems to China's future economic development. (Chinanews.cn)